LOWERING THE BABY BOOM: Can you really afford to lose income when gaining a baby·
Posted By: Matt in Economics on 05/21/2014 at 13:47:53
Many moms and dads struggle, contemplate and waver back and forth with one simple question as they plan to welcome a new baby to the family.
"Is one of us able to quit my job and still have enough money for a new child, without the feeling that money will always be tight·"
That answer is a dicey one for a number of reasons and shouldn't be entered into lightly as far as how you respond. While most would be parents begin to think of how they can get their hands on more money, it's incredibly true that the opposite end of the spectrum exists: moms and dads that are ready to give up an income even though a baby is a huge financial commitment.
Losing thousands of dollars per year while actually adding more expense seems like a silly proposition, but the idea of mom or dad being able to stay home comfortably and raise a child is the great equalizer in this discussion.
Babies are expensive, whether you're talking about supplies, formula, diapers and food, and losing an entire income makes for a decision that is thoughtfully difficult. The average baby costs between $1000 per month, and using those numbers as your financial barometer should point you in the right direction as far as losing one income out of a two income family.
What's even more staggering from a financial standpoint is the cost of raising a child from birth to age 18. That's going to take a quarter of a million dollars, money that might not be just lying around with only one parent working.
One thing moms and dads might want to weigh is the cost of child care and keeping both jobs or staying home with the new baby and saying so long to your job. Another financial aspect to mull over is the stability of the job that isn't being questioned. For example, if your husband works on sales commission, and his salary fluctuates from month to month or year to year, keeping a second income might be the kind of backup plan that isn't optional.
Plenty goes into the final call one way or another as far as having one parent work diligently at home with the new baby. Most of the time, parents can justify staying home, even if it means having to cut a few financial corners and budget accordingly. In some cases, however, dropping thousands of dollars as part of your income just isn't feasible or smart business moving forward for the entire family.
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